14 Recent Lawsuits and Settlements Involving Hospitals

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The following hospital lawsuits, settlements or legal developments were reported within the past month, beginning with the most recent.

1. Health First in Florida Settles 7-Year-Old Antitrust Suit
Rockledge, Fla.-based Health First settled a seven-year-old antitrust lawsuit with Space Coast Health Foundation. Space Coast Health Foundation is a charity that resulted from the sale of non-profit Wuesthoff Health Systems. Wuesthoff sued Health First in 2005, claiming the four-hospital system used preferential pricing and bundled services to damage Wuesthoff's ability to compete in the local market. Health First denied the allegations.

2. Lawsuit Alleges Swedish Covenant in Chicago Withheld Charity Care
Two uninsured patients sued Swedish Covenant Hospital in Chicago, alleging the non-profit hospital failed to provide charity care. The lawsuit claims the hospital conducted unfair practices under Illinois consumer fraud law. It seeks $50,000 in punitive damages and a change in hospital policy.

3. Bingham Memorial in Idaho Sues County Regarding Internal Probe
Bingham Memorial Hospital in Blackfoot, Idaho, sued Bingham County. The hospital claims a series of allegations from county officials harmed Bingham Memorial's reputation and led to an internal investigation by a law firm that ended up taking nearly 1,500 billable hours of time and charged roughly $500,000.

4. Bartlett Regional Hospital in Alaska Discloses $956k in Overbilling Errors
Bartlett Regional Hospital in Juneau, Alaska, disclosed it overbilled Medicare and Medicaid by more than $956,443 from 2006 onward. It self-disclosed the overbilling and currently negotiating a settlement with the government.

5. Baylor Health System to Pay $907k for Alleged False Claims
Dallas-based Baylor Health Care System and Baylor University Medical Center agreed to pay roughly $907,000 to resolve allegations that it submitted false claims to Medicare for various oncology services from May 2006 through 2010.

6. Supreme Court Justices Raise Challenges to Both Sides in FTC v. Phoebe Putney Hearing
The Supreme Court heard arguments from both sides in the Federal Trade Commission v. Phoebe Putney Health System case this week, which centers around a $195 million hospital acquisition and the application of state action immunity. In the hearing, Supreme Court justices presented some challenges to both sides.

7. Morton Plant Mease Health in Florida Resolves False Claims Allegations With $10M
Clearwater, Fla.-based Morton Plant Mease Health Care agreed to pay $10.17 million to resolve allegations that it violated the False Claims Act by overbilling Medicare.

8. Bayonne Medical Center in New Jersey Faces Allegations of Retaliatory Firing
A former employee claims Bayonne (N.J.) Medical Center fired him after he reported illegal staffing practices in the hospital's hematology department. BMC has denied all allegations of the retaliatory firing. A trial is scheduled for Nov. 26.

9. Valley Medical Center's Hospital District Sues UW Medicine on Merger Legality
The public hospital district that owns Valley Medical Center in Renton, Wash., is suing University of Washington Medicine in Seattle to determine the legality of the governance of a strategic alliance between VMC and UW Medicine.

10. St. Alphonsus in Idaho Files Antitrust Suit Against St. Luke's Over Practice Acquisition
Saint Alphonsus Health System and Treasure Valley Hospital in Boise, Idaho, sued St. Luke's Health System, claiming the defendant's acquisition of a nearby physician group would give it control of more than two-thirds of primary care physicians in the area.

11. Judge Orders Halifax Health to Release Internal Emails in Whistleblower Case
A federal judge ordered Daytona Beach, Fla.-based Halifax Health to release internal documents as part of a whistleblower lawsuit alleging Medicare fraud. Officials from Halifax Health have denied any wrongdoing.

12. Freeman Health in Missouri to Pay $9.3M for Alleged Stark Violations
Joplin, Mo.-based Freeman Health System agreed to a $9.3 settlement to resolve allegations that it knowingly compensated physicians in a manner that violated the Stark Law and False Claims Act. The three-hospital system disclosed to the U.S. Attorney for the Western District of Missouri that a number of its physicians were eligible for incentive compensation that may have factored the value and volume of their referrals.

13. AHA Sues HHS Over Medicare Audits, Payment Denials
The American Hospital Association and four hospitals sued HHS over denied Medicare payments resulting from recovery audits. The AHA filed suit with Missouri Baptist Sullivan (Mo.) Hospital, Munson Medical Center in Traverse City, Mich., Lancaster (Pa.) General Hospital and Trinity Health Corporation in Livonia, Mich. The plaintiffs claim CMS "simply refuses" to reimburse hospitals for services covered under Medicare Part B that CMS acknowledges as reasonable and medically necessary for the patient.

14. Whistleblower Claims Northwestern Memorial Double-Billed Government
Federal prosecutors unsealed a whisteblower lawsuit claiming Northwestern Memorial Hospital in Chicago violated the False Claims Act by double-billing the government.

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Non-Compete Agreements Among Healthcare Providers: 6 Trends
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3 Core Legal Issues for Hospital Marketing Programs

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